On the Dash:
- Dealertrack index hit 105 in July, its highest reading since November 2015
- Approval rates rose to 74%, up for a fourth straight month
- Loan terms over 72 months held at a record 31.1% share
The Dealertrack Credit Availability Index rose to 105 in July, its highest reading since November 2015, according to Cox Automotive. The All-Loans Index increased 0.5% from June and stands 7% above July 2025.
Cox Automotive attributed the monthly gain mainly to a narrowing yield spread and continued improvement in loan approval rates. A pullback in subprime share offset some of those gains.
The overall loan approval rate climbed to 74% in July, up 37 basis points from June. It was the fourth straight monthly increase and the highest approval rate since August 2025. The rate is unchanged year over year.
Subprime share fell 21 basis points to 16.4%, marking a fourth consecutive monthly decline following a surge to 19.5% in March. Even with that pullback, subprime share remains up 267 basis points from a year ago.
The yield spread narrowed 20 basis points, from 6.77% to 6.57%, its tightest reading since January 2025. The average contract rate dropped 8 basis points to 10.90%, while the 5-year Treasury yield rose 12 basis points to 4.33%.
Loan terms longer than 72 months held at 31.1% in July, matching June’s all-time high in the dataset. The index had already flagged that share as a record when it hit the same level in June, a month in which the overall index reached 104.5 on its fifth straight monthly gain. July’s figure is up 484 basis points from a year earlier.
Negative equity share declined 23 basis points to 56.8%, a fourth straight monthly drop after peaking at 59.2% in March. It remains up 269 basis points year over year and above every monthly reading recorded between 2015 and 2019.
Down payments fell 22 basis points to 13%, the lowest level since October 2022.
By channel, Independent Used posted the largest monthly gain at 0.8%, followed by All Used at 0.5%. Certified pre-owned and Non-Captive New were the only channels to decline, each losing 0.2% to 0.3%.
Among lender types, Credit Unions led with a 1% monthly gain. Captives rose 0.8% and Finance Companies rose 0.3%. Banks were the only lender type to decline, dropping 0.9%.
The index closed July at 105, its highest level since December 2015. Cox Automotive said extended loan terms and elevated negative equity remain risk factors even as overall credit access improves.
